UPDATE

(8th May 2012 @ 11.34pm):

Microsoft has today confirmed that it’s Xbox 360 console will be available in a new way. The console can be purchased for the low price of $99, however, the user must pay a $14.99 subscription fee each month for two years. The bundle includes a 4GB Xbox 360 (RRP $199), a Kinect Sensor (RRP $150) and Xbox Live Gold Membership for the duration of the two years (RRP $120). It also includes warranty for the two years.

ORIGINAL ARTICLE:

(2nd May 2012 @ 7.55pm): Microsoft are allegedly preparing an Xbox 360 (4GB) bundle, including LIVE subscription and a Kinect sensor. The good news, it will retail for the extremely cheap price of $99. The catch, it will come with a monthly subscription charge. However, it is still an excellent deal..

The Verge reports that Microsoft is going to offer a 4GB Xbox 360, a Kinect sensor and an Xbox LIVE GOLD subscription for the once-off price of $99, along with a monthly subscription of $15.

It will be available for US retailers and may offer some additional subscription content in the monthly price. Even better, it will include a TWO YEAR WARRANTY. The user has to continue paying the $15 charge for 2 years, the console is then theirs to keep.

The total cost of the bundle for two years, and the $99 charge sums to a total of $459. To purchase the console bundle at RRP in retail, along with two years of membership, would cost a total of $419. The subscription bundle, as you can see, costs $40 more, however, it offers you the option to split your payment and also includes an extra year of warranty.

Remember, this has not yet been confirmed. It is expected to be announced at E3 if free. If the user cancels the subscription early, they will be charged an early cancellation fee.